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70% Increase In Debt Write Off Solutions

Today’s figures released by the Insolvency Service of Ireland show a dramatic increase in the number of debt write off solutions agreed by Personal Insolvency Practitioners in 2015.

At last things are starting to move forward for people struggling with debt here in Ireland.

The Key statistics for 2015 include:

1700 debt write off solutions were agreed for debtors which included:

479 Bankruptcies, 641 Personal Insolvency Arrangements, 221 Debt Settlement Arrangements, 346 Debt Relief Notices.

In total there were 70% more debt solutions in 2015 compared to 2014.

 

A Debt Settlement Arrangement is a formal agreement where a percentage of the debt is paid and creditors agree to write off any outstanding debt. A Debt Settlement Arrangement is an agreed settlement of your unsecured debts with affordable payments over a period of 5 years. If you have unsecured debt such as credit cards, loans and overdrafts and are insolvent then a Debt Settlement Arrangement could be the right solution to help your clear your debts. (Insolvent means you are unable to pay your debts in full and when they fall due). 

A Personal Insolvency Arrangement is a debt settlement solution that covers secured and unsecured debt, this is the insolvency arrangement for mortgage holders who are seeking a debt solution to help them restructure their mortgages, bank/credit union loans, overdrafts and credit cards. This solution is similar to a Debt Settlement Arrangement, its a formal agreement where a percentage of the debt is paid and creditors agree to write off any outstanding debt.

A Debt Relief Notice gives debt relief to people who have little or no disposable income or assets which they could use to repay what they owe. This is a debt settlement solution to clear less than €35,000 of debt. It enables eligible insolvent debtors to write off their debts where they can prove they are not in a position to repay their debt and it is unlikely their financial situation will improve in the next 3 years. 

Bankruptcy is a solution to clear all your debts if you have little or no money available to repay your creditors. Bankruptcy is a high court process for people who owe over €20,000. Before you consider applying for bankruptcy you must have explored the alternative solutions to bankruptcy which include a Debt Settlement Arrangement, Personal Insolvency Arrangement and Debt Relief Notice. Unsecured and secured debt such as mortgages for family homes or buy to let properties, business loans and credit card loans can be included in your bankruptcy.

 

Key statistics since the Insolvency Service of Ireland opened:

The Insolvency Service of Ireland have dealt with debt of almost €4 billion and helped almost 3000 people.

here is the breakdown of debt solutions:

985 Bankruptcies

840 Personal Insolvency Arrangements

319 Debt Settlement Arrangements

598 Debt Relief Notices

 

We don’t always get things right the first time round but recent changes to the Personal Insolvency Bill which included the introduction of a court review for rejected Personal Insolvency Arrangements and the reduction of the bankruptcy term to one year has now made it a lot easier for anyone struggling with debt in Ireland to have a fresh start and become debt free!

Debt problems can cause a lot of worry, stress and sleepless nights but thank god there are now solutions available to get you out of debt so you can start over again.

Gone is the time when you need to hide your debt problems and there is no shame attached to being in debt anymore as it can happen to anyone.

Most people who contact us have experienced a change in their circumstances, everything was fine and then out of the blue their hours are cut at work or they are made redundant.

There are lots of reasons why people start to struggle with debt and now there are lots of solutions available. The debt settlement solutions now available could make your credit card, bank loans and mortgage payments more affordable if you are unable to pay your debts as they fall due. You may be eligible to have up to 70% of your debt to be written off also.

The great thing about these new debt settlement solutions is that there is an end date. A Debt Settlement Arrangement will last up to 5 – 6 years and a Personal Insolvency Arrangement could last up 6 – 7 years. These are formal arrangements recognised by the court and the Insolvency Service of Ireland so they will give you legal protection from your creditors.

There are now 136 authorised Personal Insolvency Practitioners in Ireland who can help anyone struggling with unmanageable debt.  A Personal Insolvency Practitioner is a trained debt advice professional who will be able to see if you are eligible for a solution to reduce your payments and have a percentage of your debt written off.

The Personal Insolvency Practitioner will be able to sit down with the person struggling with debt to see if they are eligible for a Debt Settlement Arrangement (DSA) or a Personal Insolvency Arrangement (PIA). If the indebted person is eligible for a DSA or PIA then their Personal Insolvency Practitioner (PIP) will negotiate the debt settlement deal on their behalf.
 
If you are struggling to pay to your credit cards, loans or mortgage please don’t worry as there is now help available.  We can arrange a Free appointment for you with a Personal Insolvency Practitioner who will able to see if you are eligible for a debt solution, just give us a call on 01 4434125 today.

R.McGonnell 20th January 2016

If you would like Free Debt Advice then let us arrange a FREE appointment for you with a Debt Advisor or Personal Insolvency Practitioner who will be happy to see if you are eligible to have your Debts Written Off.

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Complete our call back form or phone us on 01 4434125 to receive Free Debt Advice Today. 

 

 

Debt Write Off Deal Agreed For Irish Family

Businesswoman cutting credit card

In January 2014 a family with massive debt became the first in the country to get mortgage debt and other debts written off under a new Personal Insolvency Regime.

The Leinster based family, whose self-employed income collapsed due to the downturn, was seeking a deal on overall debts of €600,000.

A majority of their seven lenders agreed to a Personal Insolvency Arrangement (PIA) which will see a large chunk of the Debt written off at the end of the six years of the deal.

It was the first Personal Insolvency Arrangement to be formally passed by creditors and is expected to be followed by thousands of others over the next few years.

A number of Debt Settlement Arrangements deals that do not include mortgage debts have already been completed.

In July 2014 figures were published stating that a total of 121 Debt Write Off Arrangements were completed in the first quarter of 2014 under the supervision of the Insolvency Service of Ireland (ISI).

The Insolvency Service of Ireland set up last year to help distressed borrowers admitted the number was low, but it insisted the rate of pick-up was increasing as people became more familiar with the options open to them.

There was a threefold increase in the number of Insolvency deals and protective certificates agreed in the second quarter of this year compared to the first three months.

(Protective certificates are certs which protect debtors and their assets from legal proceedings by creditors while the debtor applies for a Personal Insolvency Arrangement.)

Many creditors are now accepting the Debt Write Off deals arranged through the Insolvency Service of Ireland.

All new processes need time and it took a few years for the UK Personal Insolvency Service to start seeing the benefits of their Insolvency Bill.

For example in the first quarter of 2014 there were 24,931 Individual Personal Insolvency Debt Write Off deals in England and Wales. This was made up of 5,671 Bankruptcies, 6,549 Debt Relief Orders (DROs) and 12,711 Individual Voluntary Arrangements (IVAs).

A Debt Relief Order is the UK equivalent of a Debt Relief Notice and an IVA is the UK equivalent of a Debt Settlement Arrangement.

The UK does not have any equivalent to our Personal Insolvency Arrangement so it’s great to see a new solution available to help people in Ireland deal with mortgage debt and negative equity.

Last week the Irish Society of Insolvency Practitioners called for the following amendments to be made to improve the Personal Insolvency Bill also.

It called for the period of bankruptcy to come down from a maximum of five years to three.

The five-year bankruptcy process has meant lower numbers opting for this than expected.

There should be no VAT charged on the services of a Personal Insolvency Practitioner. VAT of 23pc is charged at the moment.

Fees for Personal Insolvency Solutions should be reduced from €500 to €50 and it also calls for the names of people benefiting from Debt Settlement Solutions to be withheld by newspapers.

Hopefully these amendments will be made and there maybe more changes made along the road to improve the Personal Insolvency Bill but thank god we now have legal system in place to help people in Ireland clear their Debts and have a fresh start.

If you are worried about debt or struggling to make your monthly repayments on your credit cards and loans then make sure you speak to a Debt Advisor or a Personal Insolvency Practitioner today.

It’s always worth speaking to an expert to find out what debt solutions are available for you.

R.McGonnell 21st September 2014

If you would like Free Debt Advice then let us arrange a FREE appointment for you with a Debt Advisor or Personal Insolvency Practitioner who will be happy to see if you are eligible to have your Debts Written Off.

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Free Debt Advice Ireland – The Personal Insolvency Act 2012

Write Off Your Debt

The Personal Insolvency Act became law in December 2012.  Previously, if you were insolvent, bankruptcy was the only formal mechanism available for you to settle your debts and get protection from your creditors.

The Personal Insolvency Bill provides three new legal Debt Settlement Solutions for people who cannot afford to pay their personal and mortgage debts.  The Insolvency Service of Ireland administers these debt resolution processes.

The first Debt Settlement Solution a Debt Relief Notice, allowing for the write-off of unsecured Debts up to €20,000 after a three-year period.

The borrower must have no assets, no disposable income and no realistic chance of paying off their debts. This Debt Settlement solution will be managed by an intermediate like the Money Advice and Budgeting Service.

The second Debt Settlement Solution is a Debt Settlement Arrangement for unsecured debts over €20,000. The borrower pays the lender what they can after providing for what the Bill calls “a reasonable standard of living”.  After a period of no more than five years, the outstanding debt is written off.

The Debt Settlement Arrangement requires agreement between borrowers and lenders and will be managed by a Personal Insolvency Practitioner. The Debt Settlement Arrangement differs from a Personal Insolvency Arrangement as it only includes unsecured debts.

The third mechanism is a Personal Insolvency Arrangement for secured and unsecured debts up to €3m. The Personal Insolvency Arrangement also requires agreement between borrowers and lenders, with the borrower paying what they can afford for six years.

The focus of the Personal Insolvency Arrangement is to leave the borrower with their house and an affordable mortgage where possible and will be managed by a Personal Insolvency Practitioner. The aim of a Personal Insolvency Arrangement is to bundle all the secured and unsecured debts into one package that the individual can comfortably pay towards over a period of six (sometimes seven) years.

On the 3rd of December 2013 the duration of bankruptcy was reduced from 12 years to 3 years. There have been 66 individuals adjudicated in the first quarter of 2014. The number of bankruptcies in first quarter of 2014 exceeds the total number in 2013.

R.McGonnell 1st October 2014